When Dayo, a young entrepreneur from Ibadan, launched his cassava flour business, he was sure he had done everything right. He had his NAFDAC number, branded packaging, even an Instagram page. But six months in, he was struggling to stay afloat. Customers weren’t returning, inventory was piling up, and competitors seemed miles ahead.
The missing piece? A well-thought-out business plan.
A business plan is not just a document for impressing banks or investors. It’s the growth compass every entrepreneur needs—especially in dynamic markets like Nigeria, Ghana, Kenya, and South Africa where resources are tight and competition is fierce.
This article will walk you through 13 strategic questions your business plan must answer if you’re serious about growing your business sustainably. These questions are not generic—they are tailored for the realities of doing business in Africa.
1. What Problem Are You Solving (And For Whom)?
This is the heart of any business plan—and the first test of your business viability.
Formula: Problem Clarity = Market Relevance
If your product doesn’t solve a real problem, you’re not in business—you’re playing.
Example: A laundry service in Lagos is not just washing clothes. It’s solving the problem of lack of time and poor electricity among working-class residents who can’t iron at home.
Tip: Use the Problem-Solution Fit Canvas to validate this. Focus on pain points, not just features.
2. Who Is Your Ideal Customer?
A vague answer like “everybody” means you haven’t done your homework.
Use a Customer Avatar: age, gender, occupation, location, income level, lifestyle, etc.
Growth Hack: The clearer your customer definition, the cheaper your marketing will be.
Example: A fashion designer in Abuja might tailor high-end native wear for career women aged 30–45 who work in banks or oil companies. That clarity helps you target ads, design the right lookbook, and even pick your shop location.
3. What Makes You Different From Others (Your Value Proposition)?
In Africa’s crowded markets, differentiation is your lifeline.
Ask: Why should a customer choose you over 10 others?
Tool: Use the UVP Formula (Unique Value Proposition):
“We help [target customer] who [problem] achieve [benefit] unlike [competitor] because [differentiator].”
Example: “We help young professionals in Nairobi who struggle with traffic delays get fresh meals in under 20 minutes, unlike Jumia Food, because we cook and deliver within a 3km radius.”
4. How Big Is Your Market (And Is It Growing)?
Understanding the market size and trends helps investors and partners take you seriously.
Use the TAM-SAM-SOM model:
- TAM (Total Addressable Market): Everyone who could ever use your product.
- SAM (Serviceable Available Market): The segment you can reach.
- SOM (Serviceable Obtainable Market): The realistic portion you can serve now.
Local Tip: Don’t just rely on global stats. Use SMEDAN, NBS, and GSMA for African market data.
5. How Will You Make Money (Your Revenue Model)?
This section separates “hustles” from real businesses.
Your revenue model must answer:
- What are you selling?
- How much does it cost?
- How often will customers pay?
Examples of Revenue Models:
- Direct sales (e.g., beauty products)
- Subscription (e.g., DSTV, Netflix)
- Commission (e.g., Jiji, Uber)
- Freemium (e.g., mobile apps)
Formula: Revenue = Price × Quantity × Frequency
❗️This top rated course on Business and Entrepreneurship breaks down revenue models with easy to understand examples.
6. What Are Your Costs (And How Will You Control Them)?
Many SMEs in Africa fail not from lack of customers but from uncontrolled costs.
Your business plan should categorize costs:
- Fixed Costs: Rent, salaries
- Variable Costs: Inventory, delivery
Use a Break-Even Analysis:
Break-Even Point (BEP) = Fixed Costs ÷ (Price – Variable Cost per Unit)
Knowing your BEP helps you price right and track when you’re profitable.
7. What’s Your Go-to-Market Strategy?
You may have a great product, but how will you introduce it to the market?
Answer these:
- Which platforms will you use? (Instagram, Jumia, local markets?)
- Will you partner with influencers or use B2B channels?
- What’s your launch timeline?
Narration: A Nigerian agro-preneur launching pepper sauce in Port Harcourt partnered with food bloggers and ran weekend tasting booths in local supermarkets. This dual strategy gave her early traction.
8. Who Are Your Competitors and What Are They Doing Right (or Wrong)?
Your plan must identify:
- Direct competitors: Selling the same thing
- Indirect competitors: Meeting the same need differently
Then do a SWOT Analysis (Strengths, Weaknesses, Opportunities, Threats).
African Insight: Don’t ignore informal competitors—those unregistered but dominant “mama put” kitchens or roadside tech repair shops.
9. What’s Your Team Composition (And Gaps)?
Great businesses aren’t built solo. Your business plan should mention:
- Founders’ experience
- Key team members
- Missing talents and how you’ll find them
Growth Strategy: Use interns, volunteers, or skill-based partnerships (like equity exchange) when funds are tight.
Example: A small Nigerian e-learning platform used NYSC corpers to create content and manage outreach.
10. What Milestones Will You Hit (And When)?
This section tracks progress and ambition. Think in 3, 6, 12, and 24-month milestones.
Examples:
- Month 3: Reach 1,000 social media followers
- Month 6: Launch website
- Month 12: Break even
- Month 24: Expand to Ghana
Visualize with a simple Gantt chart or milestone map.
11. What Risks Could Derail You—and How Will You Mitigate Them?
Every investor wants to know: What keeps you up at night—and what’s your plan B?
Categorize risks:
- Financial risks (e.g., inflation, naira devaluation)
- Operational risks (e.g., logistics, power supply)
- Legal risks (e.g., registration, tax)
Then write out:
- Preventive steps
- Contingency plans
Pro Tip: Register your business, get proper licenses (CAC, NAFDAC), and keep records to reduce risk.
12. What Metrics Will You Use to Measure Success?
Define Key Performance Indicators (KPIs) relevant to your business:
- Monthly revenue
- Customer acquisition cost (CAC)
- Repeat purchase rate
- Inventory turnover
- Website traffic
Formula Sample:
Customer Lifetime Value (CLV) = Average Value × Purchase Frequency × Duration
Knowing your numbers gives you control and investor confidence.
13. What Is Your Funding Need (And How Will You Use It)?
Be clear:
- How much do you need?
- What will it cover? (inventory, marketing, staff?)
- What kind of funding? (grant, equity, debt?)
Local Tip: Leverage Nigerian options like:
Your Business Plan Is Your Roadmap, Not a Formality
Dayo eventually rewrote his business plan after attending a local SME workshop. He realized his product lacked differentiation, his pricing was off, and he had no marketing plan. Six months after restructuring, he gained traction, secured a retail partner, and now exports small consignments to Ghana.
A business plan is more than paperwork—it’s your growth GPS.
When it answers these 13 questions with clarity, honesty, and local relevance, it becomes a powerful tool not just for launching—but for scaling and thriving in the African market.
